Austrian and Mainstream Economics on Mathematics – a Comment on Pieniążek (2018): Reply to Machaj.
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Publication date: 2021-06-15
Ekonomista 2021;(3):440-448
Machaj’s (2019) interesting comment on my original article (Pieniążek, 2018) makes several points. The major one is that in my discussion of the usefulness of the Austrian School of Economics’ (henceforth: ASE) tool of study, which is praxeology, I have drawn a faulty conclusion about its non-usefulness. Next, he discusses the status of mathematics as a language in general and in particular its applicability to economics. Finally, he tries to give an example of an ill-suited application of mathematics to economics by considering a neoclassical production function in the context of economic growth. Before I address the content of Machaj’s remarks, I think it would add to clarity if we consider the terminology he employs. He mentions at the beginning of his comment that he prefers to use the term neoclassical economics over mainstream economics (henceforth: ME) and seems to equate the two in the remainder of the text. He does not, however, provide any reasons for this nor does he argue with the distinction of mainstream economics vis-à-vis neoclassical economics that I employed in my original article. Why does he disregard, then, the typical convention that, say, an authoritative figure in the field, Acemoglu (2009) followed in his exposition of economic growth, i.e. the very topic that Machaj uses as an example of economics in his comment? Acemoglu divided the models he analyzed into the neoclassical group and the rest, despite the fact that both of the groups are undoubtedly mainstream, which suggests that the two terms are not equivalent. Although I did not elaborate deeply on the issue in my original article, I was sticking to the spirit of Colander (2000), who argued for the terminasia of neoclassical economics, i.e. for the economist-assisted killing of a term whose use is inconsistent and whose content is difficult to determine, typically being so ambiguous that it renders the term almost meaningless. It should not surprise us, as since 1900 up to the present, it has meant to describe very different ways of doing economics since the 1840s up to the present; however, the discipline has experienced such an enormous change since the 1840s (now even greater than at the time when Colander wrote his paper) that it could not possibly mean the same thing as even a century ago, rendering the term a very imprecise and hence misleading category. Moreover, even McCloskey (2010, pp. 8, 414) that Machaj mentions twice in his comment, classified Mengerian (i.e. the ASE’s) economics as neoclassical1. Given that Machaj himself juxtaposes the neoclassical with the ASE’s economics, it creates an even greater classificational mess. For all of these reasons, I prefer to terminate (nomen est omen) using the term neoclassical economics in the current context and, following my original article, stick to the mainstream economics category when denoting the economics that is contemporarily being practiced in the top journals and at the top universities. Having in mind this terminological remark, I am ready to address Machaj’s major objections to my original article.
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